Transcript Pricing Cards Power Point

• Critical time to price right
• Be ready for “fast sale”
The Wrong Price Attracts The Wrong Buyers
$300,000
Property
List Price
$360,000
Buyers won’t look.
Lookers won’t like!
$300,000 buyers won’t look at houses
above their ‘price range’.
$360,000 buyers won’t like the house
nor make an offer.
Two (2) Pricing
Strategies
Price Right
Price High
- Stay firm!
- Be negotiable?
Which will likely sell your house
- quicker? - for more money?
The Risks of Over Pricing
 Reduces sales associate activity
 Minimizes advertising response
 Loses interested buyers
 Attracts the “wrong” buyers
 Discourages or eliminates offers
 Can lead to mortgage rejections
 Helps sell the competition
 Property gets a ‘reputation”
(stale)
 Later price reductions tend to
cause low or delayed offers
Price reductions send the wrong messages!
Aspired Price
$ _______________
Acceptable Price
$ _______________
Walk Away Price
$ _______________
What is the highest price you could
realistically hope that a prudent buyer
would pay for your property?
What special features or
characteristics does your home have
to warrant this price?
While hoping for more, what price
would still be acceptable?
What features or characteristics of
your home do you thing buyers will
feel are lacking or disappointing?
What is your bottom line?
What price would be so unacceptable
that you would ‘walk away’ from
such an offer even if it meant you
could not sell your property?
The Absorption Rate
For Sale
Sold
- Minimum Competition
- Reasonable Demand
High Absorption Rate
- Extensive Competition
- Minimum Demand
- Slow Absorption Rate
People buy by ‘comparison shopping’!
The Pricing
Pyramid
Range of
FMV
Fair Market
Value
Width indicates the number of interested buyers.
The Five (5) Fatal Mistakes
Most Home Sellers Make When Pricing Their Home
1. Sellers often price their home based on “need” rather
than the market.
2. Sellers use the ‘wrong’ properties for comparison when
pricing.
3. Sellers build in a ‘negotiating cushion’ and then have
no one with which to negotiate.
4. Sellers take advice from ‘well meaning’ but uninformed
parties.
5. Sellers allow positive emotions about their property
to influence their pricing decisions.
Who Controls the Marketplace?
Factor:
Controlled by:
 Property Asking Price
 Seller
 Property Condition
 Seller
 Property Marketing
 Listing Agent/Agency
 Property Value
 Buyer
The 7 Factors
That Determine
How Fast A
Property Will Sell
High
Price
1. Time
2. Location
3. Condition
4. Marketing
Low
Price
5. Financing
6. Competition
7. Price
Fast Sale
Slow to Sell
The Listing Price Determines Buyer Demand
Price as
compared
to Value
+ 20%
+ 10%
Market Value
- 10%
- 20%
Percentage
of buyers
who will
view
property:
10%
30%
60%
75%
90%
Percentages show relationships only, not actual statistics.
CMA: Comparative Market Analysis
Market Data to Help in Determining the Initial List Price
Researching and Reporting:
 Recent Sales of Similar Properties
 Competing Properties On Market
 ‘Expireds’ & ‘Pendings’ - as
available
 Review of Market Conditions
 Sale Price to List Price Ratio
 Buyer Tends and Priorities